Whatever Happened to the ‘Us vs. Them’ Olympics?

The days of symbolic world-power competition are over, replaced by something less pitched but just as revealing.

Whatever Happened to the ‘Us vs. Them’ Olympics?

The creators of the modern Olympics founded the Games with the intent to foster peace and brotherhood, healthy athletic competition, a humanistic appreciation of man’s great achievements—et cetera, et cetera, et cetera. A nice thought. In reality, for the vast majority of the Games’ history their dirty, open secret has been that ruthless, zero-sum geopolitical competition, not sports, really gave the quadrennial competitions their sizzle.

In 1936, with Germany a hostile and ascendant power, the Black sprinter and long jumper Jesse Owens shamed Adolf Hitler on his home turf by beating every white athlete in arguably the Games’ premier event. When the civil rights era was at its fever pitch, Tommie Smith and John Carlos asserted their dignity by raising their fists in a Black power salute after a 1968 gold medal win in Mexico City. In the gloomy thick of the Cold War, Americans who otherwise could not have cared less about either the decathlon or hockey hailed Caitlyn Jenner’s flag-waving victory lap, and then the “Miracle on Ice,” as triumphs of patriotic grit over the faceless Soviet machine.

In recent years, such symbolic victories have been in short supply. The idea that each Olympics offers a shadow competition between political systems, or ideological regimes, or ways of life, now seems as outdated as the deeply-70s shag haircut Jenner sported in 1976. When politics have entered the arena since then, the intrusion is often considerably less dramatic — such as Iran’s hushed payment to a judo champion to avoid a match with an Israeli opponent in 2004, or when the Georgian government protested Russia’s Sochi Winter Olympics in 2014 but ultimately sent four athletes to the Games regardless.

Since the early nineties China has been the States’ most serious, consistent gold medal challenger for the Summer Games, even stealing their first overall win in the home-field 2008 Beijing competition. But despite repeated athletic clashes between the two major players amid a theoretical, endlessly-debated “new Cold War,” the Olympics have failed to raise much nationalistic dander about the superiority of liberal democracy to autocratic state communism, or vice versa.

With all their pomp and circumstance, the Games are now more of a showcase for individual achievement than they ever have been, rather than a steam valve for national rivalries. Athletes like Michael Phelps, Simone Biles, or the Chinese gymnast Li Xiaopeng are famous more for their personal trials and off-the-field personality quirks than as “Rocky IV”-style national stand-ins. In that way, today’s Olympics are arguably closer in spirit to the Games’ original mission of promoting a sort of global humanism and goodwill than they have been since the World War I era.

But that doesn’t mean that the Games have no political resonance whatsoever. Quite the opposite: This year’s Summer Olympics, originally slated for last summer in Tokyo, have become the red-hot epicenter of the global debate over how to combat the spread of the Covid-19 pandemic in a responsible and equitable manner. There’s also the racialized controversy over U.S. sprinter Sha’Carri Richardson’s suspension for marijuana use; umbrage from other southeast Asian countries over Japan’s refusal to explicitly ban its Rising Sun flag; and, of course, the expectation that the Russian government will engage in its tried-and-true pastime of hacking the games as a middle finger to Western domination.

And then there’s the perennial bugbear of Olympic politics: The widespread immiseration, graft and waste that inevitably follows the transformation of any given urban center into a hub for big-money international competition. If one were to superimpose an ideological framework onto today’s Olympics, they could credibly make the case that it’s not East vs. West, or the individual against the collective, but the haves against the have-nots — not just at the institutional level, as cities bend over backward to accommodate the world literally landing at their doorstep, but among competitors as well, with some facing deep financial insecurity on their way to global competition.

And yet: If ever a clash of civilizations were occurring on a global scale in our post-Cold War, less-binary world, it would be now. Young democracies across the globe like Hungary, Poland, and Venezuela have backslid into autocracy over the past decade-plus. China and Russia stand ready and eager to nudge their younger cousins onto a similar track, not to replicate the Soviet empire-building project, but simply to further kick dirt onto the concept of liberal democracy and therefore bolster their own cachet.

Given that highly-charged ideological conflict, it’s actually incredibly weird that today’s Olympics haven’t adopted the nature of their historical predecessors. But it’s also reassuring. We’ve come to understand our historical Soviet antagonists not as steroidal automatons, but individuals at the mercy of a flawed system, like Arvydas Sabonis, the Lithuanian basketball hero who dominated for the USSR before finally representing his own nation proudly at the 1992 Games in Barcelona (not to mention fathering a current-day NBA All-Star). Our pop culture lacks the personalized hatred and villainization toward Chinese or Russian athletes that was once a basic, expected element of what it meant to be an American. That’s real progress.

It’s also what makes today’s Olympic games so rich and enjoyable. As it turns out, investing nationalistic pride in an event that people across the globe now understand to be at the mercy of various corrupt bureaucracies isn’t particularly useful—and sport for sport’s sake can be far more satisfying. Just here in the United States, the miraculous revival of softball, the unexpected-yet-overdue institutional legitimization of skateboarding, or the unprecedented athletic dominance of Simone Biles, are each worth of simply celebrating in their own right, absent any exaggerated vitriol toward our international rivals.

Despite the modest beating it’s taken of late, American soft power still reigns supreme. The ability to tell those compelling stories—and, more importantly, unify people around them—might be a nation’s defining competitive virtue on this stage, more than the sheer will to manufacture dominant athletes. Look at the myths we’ve built around Phelps, Biles, or any number of the newer young stars competing in Tokyo this week: even in a globalized, less politically hard-edged Olympics, Americans still have a clear advantage.

Source : Politico USA More   

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Crypto-based ‘shadow financial market’ spooks regulators

Watchdogs are warning that some DeFi activities are probably illegal under federal law and pose serious danger to consumers.

Crypto-based ‘shadow financial market’ spooks regulators

New financial services built on cryptocurrency are offering consumers the ability to borrow and trade billions of dollars without the oversight of bankers or their regulators. Washington is now scrambling to catch up, amid concerns of illegal activity and mounting consumer risks.

Decentralized finance, or DeFi, operates on technology that powers digital currencies like Bitcoin and Ether. The services replicate the functions of traditional lenders and exchanges but operate autonomously and automatically across computer networks.

Regulators across the country are now working to get their arms around DeFi, including the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve and the Office of the Comptroller of the Currency.

Watchdogs are warning that some DeFi activities are probably illegal under federal law and pose serious danger to consumers, who are putting their money into systems that have inherently less human oversight and accountability and are vulnerable to cyberattacks.

“I’m very concerned there’s none of the reporting, none of the normal pricing and regulatory limits,” CFTC Commissioner Dan Berkovitz said in an interview. “The bottom line is there’s no free lunch anywhere in the economic system.”

The small but rapidly growing sector — activity is measured in the tens of billions of dollars — is posing a major challenge for regulators who face an unprecedented task of clamping down on an open-source financial network that has grown up completely outside their purview. The basis of modern financial regulation rests on having centralized entities — like lenders and clearinghouses — register with the government and subject themselves to oversight.

“For the first time, you're starting to see DeFi protocols that are starting to set up procedures for borrowing and lending on a large scale,” Alabama Securities Commission Director Joseph Borg said. “It's between unknown participants without any intermediaries … So now the question is, who do we put this on?”

DeFi flouts the old model, and its advocates say that’s the point — a decentralized and automated market will lower costs, increase efficiency and offer more transparency.

Celsius Network CEO Alex Mashinsky, whose crypto finance firm uses DeFi technology, said the services provide a way to "innovate and go around all of these centralized toll collectors.”

“The chronic systemic problem we have in our financial world is the fact that our traditional system, traditional finance, is concentrated, leveraged and too big to fail,” he said.

Among the most popular DeFi options is MakerDAO, one of the longest-running services, which lets users borrow so-called stablecoins in exchange for depositing cryptocurrency-based collateral. Another service, Uniswap, is a decentralized cryptocurrency trading exchange that relies on an “automated liquidity protocol” rather than a central orderbook to facilitate transactions. Like other major DeFi projects, they operate on technology that underlies Ether, one of the biggest cryptocurrencies.

The creators of some of the services are beginning to make contact with regulators. Marc Boiron, general counsel of the decentralized exchange builder dYdX, said in an email that "we have proactively (and voluntarily) communicated with the CFTC prior to the deployment of all of the protocols" and "have always carefully considered the laws applicable to dYdX." He said the first protocol dYdX developed required U.S. users to follow CFTC rules for retail commodity transactions.

DeFi services have seen rapid growth over the past year amid the cryptocurrency boom, with more than $50 billion "locked" in services based on Ethereum, the network for Ether. Major centralized cryptocurrency exchanges like Coinbase, which has been at the forefront of offering digital currency trading to the masses, have begun to let their customers deposit funds and earn returns on DeFi.

Square CEO Jack Dorsey announced earlier this month that the digital payments giant planned to create a new business around an open developer platform “with the sole goal of making it easy to create non-custodial, permissionless and decentralized financial services.” Even established Wall Street banks have begun to look at the technology as a way to revamp their systems.

But the rapid rise of DeFi is raising growing concerns for lawmakers and regulators, who are signaling a possible crackdown amid increasing evidence of consumer risks.

Recent research has raised red flags about the absence of human oversight at DeFi services and technical vulnerabilities, including attacks that drained millions of dollars from DeFI protocols.

"In DeFi, intermediaries are largely excluded in favor of transparent code, presenting regulators and policymakers with complicated decisions as to how to assess transactions (often bilateral) for which no clearly identified party may be regulated," Georgetown Law visiting scholar Linda Jeng and Castle Island Ventures partner Nic Carter said in a paper released last month.

Sen. Elizabeth Warren is pressing SEC Chair Gary Gensler to rein in DeFi activities. In a letter this month, the Massachusetts Democrat said "scams have surged" on DeFi platforms, citing an estimate from analytics firm CipherTrace that there was $83 million in DeFi fraud during the first four months of this year.

In a July 21 speech, Gensler warned that services offering crypto tokens backed by securities and operating like derivatives — "whether in the decentralized or centralized finance space" — must work within the agency’s rules.

Berkovitz, a Democratic commissioner at the CFTC, has been among the most outspoken about the urgent need for officials to come to grips with what he says could become an "unregulated shadow financial market." He argues that trading on DeFi platforms is likely happening illegally because it's not abiding by the requirements of the Commodity Exchange Act, which imposes safeguards on derivatives transactions. He revealed this month that his agency, which regulates the trading of futures and swaps contracts, was looking at DeFi across its various divisions.

"If there are loopholes they are driving through, there may need to be legislation to close them," he said.

Officials representing the SEC, CFTC and the International Organization of Securities Commissions were briefed by DeFi players in June, a sign of growing scrutiny.

Other federal agencies that oversee the banking system are also beginning to delve into DeFi, including the Office of the Comptroller of the Currency and the Fed.

"While DeFi, by definition, is decentralized and does not necessarily rely on the banking system, there are linkages, which are part of our review through the lens of responsible innovation, cognizant of the potential benefits of new technologies while focused on understanding the potential risks and use cases," OCC spokesperson Bryan Hubbard said.

State officials are urging their federal counterparts to act.

"You've got all sorts of potential possibilities and potential risks that we have got to take a look at," said Borg, the Alabama securities regulator. "It's going to be a congressional, federal mandate, by SEC, CFTC, to come up with some of this stuff."

The possibility of crackdown is already seeing pushback from some federal policymakers who champion free markets. SEC Commissioner Hester Peirce, a Republican appointee, said removing intermediaries improves resilience in the financial system. She wants to avoid "just classifying DeFi in one big bucket and saying it's all the same thing."

Crypto industry groups are also urging regulators to proceed with caution.

"I don't think there is a way to shoehorn in decentralized finance into the existing framework that depends on the regulation of intermediaries and gatekeepers," said Miller Whitehouse-Levine, director of policy at the Blockchain Association.

One of regulators' biggest challenges will be deciding to what extent to police the software underlying DeFi protocols, in light of free-speech concerns.

Jerry Brito, executive director of crypto advocacy group Coin Center, said restrictions on computer code would trigger opposition from his organization and others over the belief that it's protected by the Constitution.

"Writing and publishing software is First Amendment-protected free speech," he said. "There's no compromise to be had on that.”

Source : Politico USA More   

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